Bad Moon Rising, part 2 – Disjointed thoughts on the Economy

January 31, 2009 at 12:10 am (Family Life, Politics, Uncategorized)

To me, the superbowl has really never been important.  This year, as we approach the precipice of a depression, I see irony in it.  The U.S. steel industry was once the model of efficiency and quality for the world.  Now, it takes serious thought to remember why Pittsburgh’s team is called the ‘steelers’, or where the logo on their helmets came from.

Nobody seemed to be concerned that a ‘service economy’ just can’t exist stably.  It translates to ‘consumer based’ economy.  If all we do is consume goods created elsewhere, eventually the ‘elsewhere’  has collected all of our capital.  That leaves us with broke, but with lots of stuff.  It’s a bit like the star-bellied sneeches from Dr. Seus.  Except that they didn’t have jobs, apparently.  Don’t worry, we’ll get there.

Knowing what lies just around the corner for our country, I can’t help but think of Rome.  They continued to enjoy their circuses and gladiatorial holidays while their empire crumbled out from underneath them.  Our beloved government is going to try to borrow their way out of debt, which will only give us double-digit inflation for years.

And for a comparison between this depression and it’s place in U.S. history, here’s a video from itulip.

Update:

From the International Herald Tribune:

He now estimates that $2.2 trillion in new government debt will be issued this year, assuming the stimulus plan is approved.

“You either crowd out other borrowers or you print money,” Ferguson added. “There is no way you can have $2.2 trillion in borrowing without influencing interest rates or inflation in the long term.”

“This is a crisis of excessive debt, which reached 355 percent of American gross domestic product,” he said. “It cannot be solved with more debt.”

“People are not stupid,” Zedillo said. “They see the huge deficit, the huge spending, and wonder what comes next.”

To that last I would add that he is referring to economists that are NOT in the U.S.  Nobody around here seems to have gotten that far … yet.

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